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Proposed Addition of the Cayman Islands to the EU’s High Risk Third Countries List (the “EU AML List”)

On 7 January 2022, the European Commission adopted a delegated regulation (the “Regulation”) proposing revision of its EU AML List to add nine countries, including the Cayman Islands.

The EU AML List is the EU’s list of jurisdictions which are considered by the EU to have strategic deficiencies in their anti-money laundering / counter terrorist financing (AML/ CFT) regimes so as to pose significant threats to the EU’s financial system. There was a 30-day scrutiny period within which the Council of the EU or the EU Parliament was permitted to object to this proposed revision of the EU AML List, failing which the revised EU AML List will be effective 20 days after the Regulation is published in the Official Journal of the EU.

Background

In February 2021 the Financial Action Task Force (FATF) added the Cayman Islands to its list of jurisdictions under “increased monitoring” in the area of AML/ CFT (the “FATF List”). This listing occurred despite Cayman being considered as compliant or largely compliant in respect to 39 of the FATF’s 40 Recommendations and having completed 60 out of 63 FATF Recommended Actions. The Cayman Islands is now compliant or largely complaint with all of the FATF’s 40 Recommendations and is continuing to address strategic deficiencies in only two remaining “Recommended Actions” relating to (i) having effective sanctions for non-compliance with beneficial ownership requirements; and (ii) demonstrating effective prosecution of money laundering cases. It is these two areas which have been used as justifying the Cayman Islands’ addition to the EU AML List.

 

To continue reading full articles in PDF format:
Proposed Addition of the Cayman Islands to the EU’s High Risk Third Countries List (the “EU AML List”)

 


Maree Martin
Counsel and Head of Knowledge Management - Cayman Islands

Cayman Islands   +1 345 814 7781


Alan Dickson
Partner

Cayman Islands   +1 345 814 7790


Derek Stenson
Partner

Cayman Islands   +1 345 814 7392


Jarladth Travers
Senior Vice President and Head of Conyers FIG (Cayman) Limited

Cayman Islands   + 1 345 814 7773


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